In the past five years, deposits onto exchanges have typically exceeded withdrawals, except for a notable instance during the FTX collapse in November 2022, when withdrawals surged.

Usually, surges in Bitcoin deposits coincide with price increases, as investors seek to sell their holdings. For instance, over 90,000 BTC were deposited onto exchanges in a single day during Bitcoin's peak price in March 2024.

However, since then, deposits have decreased to around 43,000 BTC as of May 19. While withdrawals have lagged behind deposits, the gap between the two has been narrowing. As of May 19, withdrawals amounted to approximately 30,000 BTC, reducing the difference between deposits and withdrawals to around 13,000 BTC – the lowest level since Q4 2023.

This trend indicates that although substantial deposits are still occurring, suggesting selling pressure, the decreased gap implies a reduction in net deposits rather than a surge in withdrawals. The daily reduction in deposits has contributed to Bitcoin's nearly 20% increase from its local bottom on May 1.